In a recent move, Binance, a leading cryptocurrency firm, has integrated Bitcoin (BTC) on the Lightning Network, a layer-two solution, enabling users to execute payment channels off-chain. The integration of the Lightning Network will introduce cheaper and faster Bitcoin transactions, allowing users to deposit and withdraw BTC on Binance through Lightning Network channels. The integration also ensures cost-effectiveness and improved transaction efficiency.
Moreover, the Lightning Network significantly boosts the speed of Bitcoin transfers, completing transactions in mere seconds. This feature, coupled with lower transaction fees compared to the BTC mainnet, makes the process of transferring cryptocurrencies more affordable. In addition, the Lightning Network is capable of handling several transfers per second, effectively addressing the current scalability issues faced by Bitcoin.
Now, when users decide to deposit or withdraw Bitcoin, they have the option to choose “LIGHTNING.” This is in addition to other existing options such as BNB Smart Chain (BEP-20), Bitcoin, BNB Beacon Chain (BEP2), BTC (SegWit), and Ethereum ERC-20.
Binance’s move to integrate the Lightning Network followed a temporary pause in BTC withdrawals due to a flood of pending transactions caused by a surge in BTC network gas fees. This surge was largely attributed to the creation of memecoins on Bitcoin in the form of BRC-20 tokens, a new token standard on the network.
Binance joins other prominent exchanges like Bitfinex, River Financial, OKX, Kraken, and CoinCorner that have embraced the Lightning Network. Coinbase CEO Brian Armstrong also signaled his intention to integrate the Bitcoin layer 2 network on Coinbase in April, though he did not provide a timeline.
Meanwhile, in response to user feedback, Binance has also launched a new feature enabling users to obtain multiple deposit addresses for a single network. Initially, users could only generate multiple deposit addresses for tokens on the Ethereum network (ERC20) and Ethereum alternative networks (e.g., Arbitrum One, BNB Smart Chain). More blockchains would be supported at a later stage. Users could obtain up to 20 deposit addresses for each network.
